Lahore Waste Management Company is effectively lifting waste from every nook and corner of the city. After the expiration of the contract with the Turkish contractors LWMC took over the responsibilities to clean the Lahore. While talking about the contract with the foreign contractors (M/s Albayrak and Ozpak), expired on 31st Dec 2020 Lahore Waste Management Company Chairman, Malik Amjad Ali Noon stated that the contracts were ill conceived in the first place. These were poorly designed contracts that stipulate the procurement of services at inflated rates favoring the International Contractors. Additional terms and conditions were also cleverly designed to suit persons of choice. The bidding process itself was rigged by non-transparency of prequalification. Even the 2011 issuance of the tender documents to the international contractors were without the approval of the Board of the Directors. “The executed contract delivered over payments to the international contractors by allowing higher import duties as a result the organization bore losses of 236.735 Million” said Mr. Noon.
He said that the internal findings of the forensic report also indicate misappropriation of the accounts. Whereas inflated guaranteed waste was incorporated in the contracts (4700 Tons/day) whereas in the year 2020, per day reported claimed waste was around 3800 tons / day. The international contractors were also permitted to submit performance guarantee (US Dollar 4 Million) in installments of two and three years in breach of original terms and condition. Additionally a rupees 3 billion, mobilization advance was given to international Contractors whereas such a facility was not disclosed at the time of IFP (Invitation of Prequalification) for other potential bidders. The contracts were also sustained on inflated cost with incorrect calculations of US $ 2.5 Million. Transfer stations that were to be built as a part of the contract were not made. Even the income tax that was to be contractually and legally paid by the contractors was thirst on LWMC to bear which was against the principles of normal course of the business in Pakistan.
“These are not just allegations, evidences from hundreds of videos and images prove that unauthorized waste of construction and demolition material was lifted” said Mr. Noon. “As per record from 2020 besides the population growth in 7 years reported/ claimed average tonnage was 3800 Tons which was around 4700 tons/ day in the last 7 years. Estimated losses over the period of the contract are around Rs. 6 Billion. These are gargantuan sums of money for a country that can’t afford to waste even 1 rupee.”
As per the contract with the foreign companies US $ 16 / Ton was the contractually agreed rate to be paid. Multiple evidences were found where water sludge and mud were port into the waste to increase the total tonnage. Additional proves also pointed towards tampered calibration of the weigh station. Furthermore, to meet a falsified number of the daily tonnage, the weight of the carrier trucks was not deducted from the total gross tonnage.
“Unprofessional corrupt practices was standard M/s SKB Albayrak J.V (for construction of metro) were required to clear debris from the side whereas M/s Albayrak charged LWMC more than rupees 100 Million for the work that was legally theirs to delivered. Similarly, the contractors collected unauthorized debris from Orange line train and charged LWMC more than rupees 400 Million. The Lahore Ring road janitorial services contract was issued for Rs. 110 Million and outsourced to Albayrak for Rs. 150 Million/ Annum. These are a few allegations in the long list of grievances” Mr. Noon explained.
This mistake from the past and rectifying administrative embezzlements and misuse is not an easy task. On questioning the present faults the Chairman LWMC said contracts were extended multiple times and should have been if necessary extended at discounted rates, as there was no additional resources required that needed deployment. Even the machinery was very old and reduced at its book value cost. The seven year contract was expiring on March 2019 and M/s Albayrak didn’t deposit the requisite performance guarantee. A lesser performance guarantee of US $1.2 Million was submitted much later. Again the contracts were extended up to 31 Dec 2020 for which performance guarantees were not submitted. According to the Chairman these are the elements that need public accountability and the LWMC should recover the illegitimate payments and also take disciplinary actions against all those responsible. The LWMC Board of the Directors would be looking into charging financial claims for non-compliance of the performance of the contractors. The government might even initiate the black listing process against the contractors to safeguard other business entities and prevent their future participations for public procurement.
